• by Richard Whitman , Columnist, January 10, 2022

M&C Saatchi disclosed last week that a “preliminary approach” regarding a possible M&A transaction had been made by a tech company called AdvancedAdvT, which is headed by Saatchi board member Vin Murria.

That approach has quickly evolved into all-stock reverse merger “potential” proposition that Saatchi’s independent board directors (excluding Murria) has already concluded is insufficient.

Among other deficiencies, the directors stated “the Proposal does not reflect the value of the business and its future prospects and would disproportionately transfer equity value from M&C Saatchi shareholders to AdvT shareholders.”

The directors added in a statement to the London Stock Exchange that the agency had a turnaround plan in place since early last year that resulted in an improved financial performance, as well as significant new business, including the addition of clients Uber, Google, Tiktok and Tinder.

There were also new assignments from existing clients, such as the UK Government, Pepsico, Reckitt and Lexus.

“It is not clear to the Independent Directors how shareholders and other stakeholders would benefit from ownership dilution and a change in board leadership of the Company,” the statement added.

Responding to the rebuff, AdvancedAdvT issued its own statement, the gist of which is that it looks “forward to the opportunity to discuss our proposal and address the points raised” by the agency’s independent directors.

Let the negotiations begin and stayed tuned.